As technology evolves, every industry, including insurance, must adapt to improve efficiency and meet customer expectations. Automation offers new growth opportunities, but realizing its full potential requires strategic planning. Let’s explore how insurers can leverage automation to stay ahead of the competition.
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Challenges in implementing automation solutions in insurance companies
Implementing automation solutions in insurance companies presents challenges beyond technology adoption. Here are some key obstacles that insurance companies must overcome.
Complex IT architecture
Many insurance companies continue to rely on legacy systems built long before automation technologies became mainstream. These outdated platforms often don’t support modern technology tools, making integration difficult (Infosys Consulting). For insurance firms, this makes scaling automation efforts a significant challenge that requires careful planning and investment.
Interconnected systems
Many tasks in the insurance sector are manual and repetitive. They often involve non-sequential, isolated activities that could be more easily automated at scale. Despite being low in complexity, these tasks don’t align better with end-to-end automation efforts due to their fragmented nature. As a result, they may not present a compelling business case for automation since scaling such initiatives often requires processes that are more cohesive and interconnected to maximize efficiency (Infosys Consulting)
Fragmented data & processes
Insurance companies have developed multiple channels to connect with customers, employees, and partners, ranging from call centers and mobile apps to self-service portals and chatbots. While these options enhance customer engagement and offer personalized experiences, they also create numerous disconnected data sources (Spixii). This fragmentation makes it challenging to consolidate and leverage data effectively, creating barriers to deploying automation at scale. According to a Deloitte survey, 36% of respondents identified fragmented processes as the biggest obstacle to adopting intelligent automation.
Security and regulatory compliance
The insurance sector handles highly sensitive data, making cybersecurity a critical focus and challenge. As Deputy General Director Mr. Chu Manh Sinh emphasized, ensuring network security is a pivotal and breakthrough task to build digital trust. The strategic directive highlights that cybersecurity is not only essential for safeguarding digital transformation efforts but also for fostering a safe, transparent, and law-abiding digital environment. This initiative aligns with the national strategy for successful digital transformation, underscoring the importance of protecting Vietnam’s Social Insurance sector against cyber threats to ensure its sustainable growth.
Change management in employees
Reality shows that when employees perceive automation as a threat to job security, it can lead to significant resistance, regardless of the potential benefits. A study found that a perceived 10% increase in job-loss fears can reduce employee health by 2.38%, contributing to presenteeism (working while unwell). This behavior leads to an estimated annual productivity loss between $24 million and $174 million in the U.S. alone. To maximize the success of automation, organizations must proactively address these fears through transparent communication and re-skilling initiatives.
How to expand the number of processes and scale automation applications in insurance companies
Given the abovementioned challenges, here are some recommended strategies to systematically overcome each obstacle and drive operational efficiency within the insurance sector.
Identifying and prioritizing potential processes
Insurance companies should analyze and evaluate their existing workflows to identify processes with automation potential. Focus on repetitive, manual, time-consuming, and error-prone processes, particularly those related to claims processing, contract management, and customer service. Once these processes are identified, companies can create a Proof of Concept (POC). A POC is a small-scale initiative designed to test whether an automation tool or framework can meet the specific requirements of a project. It’s like conducting a controlled experiment to assess whether the chosen solution can address the challenges faced by the team effectively (TestGrid)
Establishing CoE to connect departments
The establishment of Centers of Excellence (CoEs) is a highly effective strategy for scaling automation across departments in insurance organizations. These CoEs centralize expertise, providing training, fostering best practices, and facilitating the smooth adoption of automation tools. They act as hubs of knowledge, offering support to teams as they embark on their automation journey (Camunda)
By empowering teams to drive their own automation initiatives with the right tools and guidance, CoEs can promote a culture of innovation and experimentation. Importantly, CoEs should avoid becoming bottlenecks; instead, they should enable departments to launch automation projects quickly and efficiently, fostering continuous learning and improvement. CoEs help to balance centralization and decentralization, ensuring that teams across departments feel supported without losing the autonomy to innovate.
Training for cultural change within the organization
Employee training and mindset shifts through training are crucial for successful digital transformation. Bao Viet Life, one of Vietnam’s largest life insurance companies, has made strides in this area. One of their main challenges was persuading departments to embrace process changes. However, by organizing internal workshops, the company showcased the results and potential of RPA. These sessions not only demonstrated the benefits of RPA but also collected feedback and suggestions from employees for further automation opportunities.
According to Mr. Dao Duc Giang from the IT Project Management Department, the implementation team used these results to help convince other departments to adopt and expand RPA. This hands-on, collaborative approach helps overcome resistance and build confidence in automation across the organization.
Read more about Bao Viet Life Case Study: LINK
Choosing the right technology partner
Priority should be given to selecting technology partners with experience in implementation. These partners will help optimize deployment time and costs, while also providing expertise in technology and employee training. Companies should also consider long-term success. Deloitte suggests it is important not to focus solely on reducing costs to boost short-term profitability. It has to strategically free up capital for long-term growth opportunities such as innovation, enhanced capabilities, and expansion into new markets.
With experience in driving digital transformation alongside major clients in the insurance industry, such as PJICO, Prudential, and Bao Viet Life, akaBot, a solution Made by FPT, has been chosen to support intelligent automation processes. With a track record of serving over 4,000 clients across various industries and countries, akaBot boasts a 99% accuracy rate and 90% time savings in task processing, making it a leading technology partner for enterprises.
Conclusion
As digital transformation accelerates, customers are becoming more accustomed to technology-driven convenience and speed, creating pressure and challenges for the insurance industry. In this context, automation is the key for insurance companies to confidently embark on their journey toward greater efficiency and digital transformation.
Contact us now to begin your intelligent automation journey in the insurance market!
